British Muslims vs. student loans

British Muslims are facing the dilemma of whether to pursue a university education or not. Some are being forced to turn it down because student loans in the UK are interest-bearing, which is forbidden to Muslims according to Islam.

This article was written by Muhammad Faisal Khalil and reflects his personal analyses and opinions, rather than those of EARS.

Muslims regard interest-bearing loans as forbidden. In the UK, this has meant that Muslim students, at least in principle, cannot take out interest-bearing student loans that the government is offering to them to be able to go to university. The UK government promised interest-free student loans to Muslims in 2013. “Never again should a Muslim in Britain feel unable to go to university because they cannot get a student loan — simply because of their religion,” declared the former UK Prime Minister David Cameron.^[1] Eight years on, however, there is still no alternative available for Muslim students.

The dilemma
This has affected Muslim students in striking ways. Some were forced to not go to university. “Because of the interest, I wasn’t able to actually take the loan, I couldn’t go to university, so I ended up not going to uni and working instead,” says Sayanb.^[2] Some had to defer university until they had earned the tuition fee themselves. “I had to go back to work and decided if I did want to go to university, I’d have to self-fund because there was no other option,” says Amina, Sayanb’s sister.^[3] Some made compromises and took out a student loan to attend university. Sayanb and Amina’s sister, Asha, did that. “Other people [like myself] had no option but to take out the loan. But with a very, very heavy heart, and that also affects their studies as well.”^[4]

The barrier
In addition to interest-bearing student loans, British Muslims like Sayanb, Amina, and Asha are also facing another challenge. With university tuition fees significantly rising under the Conservative government over the past decade, more and more Muslims are unable to afford a university education. According to a 2017 report by the UK’s Social Mobility Commission (SMC), young Muslims face an “enormous social mobility challenge… from school through university and into the workplace.”^[5] In 2015, the Muslim Council of Britain confirmed that only about a quarter of Muslims over the age of 16 have degree-level or higher qualifications. This is particularly the case with Muslim women in the UK, who the SMC report confirms, “are more likely than all other women to be economically inactive.”^[6] The case of interest-bearing loans only worsens the poor social mobility of British Muslims. “In terms of education, the reason why it’s such a big problem for some students is that there’s not really another way around student loans, there’s no other area you can get into university,” says Asha.^[7]

The solution
While the UK Islamic Finance Council was commissioned by the government and has developed an alternative student loan for Muslims, no progress has been made since David Cameron’s 2013 commitment. The Council explains that despite considerable frustrations among Muslims, they are still waiting for the Department for Education to greenlight the alternative plan.^[8] Until the alternative is offered, British Muslims believe their choice has been taken away from them by the government. “So, it’s either go to university and compromise my principles and my faith, in essence or don’t go to university at all. So that choice was taken away from me,” says Amina.^[9] Ayesha supports Amina’s point: “On the assumption that you will not compromise your religion — and nobody should be forced to — a Muslim student has the choice between paying for the entirety of their education upfront, or not going to university. That’s no choice at all.”^[10] Ayesha believes she was forced to take out the loan and plans to pay it back as soon as possible. “For myself and most of my Muslim friends, getting rid of that debt is the number one priority — we want to get rid of it as quickly as we can. We find it sinful. It’s horrible, to be honest.”^[11]

Is there a choice?
So, do Muslim students in the UK genuinely not have a choice? Islamic law, under the category of ‘riba’, defines ‘interest’ as money earned out of money, and argues that money should not be used in this way; “it is in fact used up and after spending it, it is needed to be produced again.”^[12] Under the Quranic principle of akl al-amwāl al-bātil (devouring wealth through unfair means), asking for money over the original amount loaned is ‘oppression’. Islamic law accordingly explicitly forbids interest.^[13] From this position, British Muslims do not seem to have a choice. Leading Muslim scholars across the world, however, have asked Muslims to take part in modern banking, with the claim that with interest so prevalent, it is unavoidable and those who pay it are not doing something sinful. “The issue of interest is mentioned in more than one instance in the Quran. Not at one place has the Quran condemned those who pay interest. In fact, it calls them ‘oppressed’ and asks the lender to give them time if they are facing financial constraints.”^[14] By recognising themselves as oppressed, British Muslims, therefore, can choose to take interest-based student loans. So, until Sharia-compliant student loans are introduced by the government, British Muslims may still have a morally legitimate choice to make.

Is there hope?
But the lack of government action remains a profound concern. Estelle Clarke, a student finance campaigner, explains the government’s inaction as an indifference “to a systemic discrimination against certain students on the grounds of their religion.” The Department for Education itself has confirmed plans to introduce Sharia-compliant student loans but has offered no timeline. “We will provide further information on alternative student finance options in due course.”^[15] Without a timeline, British Muslims like Asha believe there is no hope. “What I had was hope back in 2013. Now students who are contemplating this have no hope, there’s no alternative student finance that will be available by this year. People need to have a bit of hope, and a timeline, something they can work towards.”^[16]

This article was written by Muhammad Faisal Khalil and reflects his personal analyses and opinions, rather than those of EARS.

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^[1] Religion or an education? How British Muslims are forced to decide

^[2] Missing out on university – because of religion

^[3] Missing out on university – because of religion

^[4] Missing out on university – because of religion

^[5] Young Muslims in the UK face enormous social mobility barriers

^[6] Young Muslims in the UK face enormous social mobility barriers

^[7] Missing out on university – because of religion

^[8] Missing out on university – because of religion

^[9] Missing out on university – because of religion

^[10] Religion or an education? How British Muslims are forced to decide

^[11] Religion or an education? How British Muslims are forced to decide

^[12] Ghamidi, Javed Ahmad (2006) ‘On the Question of Interest.’ Monthly Renaissance (September 2006)

^[13] Relevant references: Qur’an (3:130, 4:161, 30:39, 2:275-2:280).

^[14] Ghamidi, Javed Ahmad (2006) ‘On the Question of Interest.’ Monthly Renaissance (September 2006)

^[15] Missing out on university – because of religion

^[16] Missing out on university – because of religion